The vertebrate central nervous system is formed with great precision into discrete yet interconnected structural and functional units that control anima behavior. Compartmentalization of the neuroepithelium into these functional units is facilitated by its exposure to signaling molecules secreted from localized organizing centers (Jessell, 2000; Hbert and Fishell, 2008; Scholpp and Lumsden, 2010). The zona limitans intrathalamica (zli) is one such signaling hub in the caudal forebrain that is the source of secreted morphogens, including Sonic hedgehog (Shh), that are essential for developing the thalamus into a vital processing and relay station for sensory and motor signals to the cerebral cortex (Epstein, 2012; Martinez-Ferre and Martinez, 2012). Mouse mutants that lack Shh in the zli and/or basal plate of the caudal diencephalon show significant alterations in thalamic progenitor identity and nucleogenesis (Szab et al., 2009; Vue et al., 2009; Jeong et al., 2011; Bluske et al., 2012). Despite the importance of the zli for thalamic morphogenesis, our knowledge of how this narrow boundary between the thalamus and prethalamus is established as a major brain-organizing center remains unresolved. Central to the understanding of zli formation is the mechanism by which Shh transcription is activated within its prescribed domain. Studies from my lab have provided substantial insight to the regulatory landscape underlying Shh transcription in the CNS (Jeong et al., 2006; Jeong et al., 2008; Geng et al., 2008; Jeong et al., 2011; Zhao et al., 2012). Experiments in this proposal will address the hypothesis that enhancers with overlapping activity in key brain signaling centers share a common cis-regulatory signature. Our preliminary studies have identified six sequence motifs that are highly enriched in a set of enhancers that coordinate the expression of Shh and other co-regulated genes in the ventral midbrain, caudal diencephalon and zli. In the following three aims, we propose to systematically evaluate the requirement of candidate components of the cis and trans regulatory network underlying Shh/zli gene expression (Aims 1 and 2), clarify the evolutionary origin of the vertebrate zli (Aim1), and determine whether specific alterations in the regulation of Shh/zli expression contribute to neurodevelopment disorders of thalamic function (Aim3).